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Taxation, the State and Society

The Fiscal Sociology of Interventionist Democracy


Marc Leroy

This book investigates the relationship between taxation, the State and society in democracy. Fiscal sociology is a broad social science in terms of its disciplines: law, economics, sociology, political science, management, economics, psychology etc. are mobilized. Fiscal sociology is general because it tackles a wide range of problems: genesis, development and crisis of the State, policy factors (ideas, institutions, division of left and right, lobbying etc.), vote-catching of the ruling elite, resilience of the welfare State, neo-liberal ideology of market efficiency, impact of capitalist globalization, democratic political choices and constraints on the functions of the interventionist State etc. It is empirical in terms of understanding the financing of public action: social division of society by the tax policy, growth of public expenditure, bureaucratic labelling of the tax deviance, budget performance, rationality of taxpayers, complex rules etc. It analyses the incoherence of a societal regulation of globalization: redistribution and inequalities of incomes, tax competition between the States, tax havens, tax planning and relocations of the multinational groups, action of the European Union, the OECD etc. It studies the conditions for a tax citizenbased conception of a democratic social contract.


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CHAPTER 7 Obstacles to Fiscal Democracy 203


203 CHAPTER 7 Obstacles to Fiscal Democracy The role of context is important, even though, as we have seen in the previous chapter, we can put this variable aside in order to target the elemental factors of tax policies. It is obvious that the general situation of capitalism and of democracy, or more commonly, the periods of elections, of ideological debates, of crisis etc. influence the configura- tion of public problems to be resolved by taxes and/or public spending. All the same, the use of contexts, which opens up opportunities for reflection, changes and choice, is noted by decision-makers in an ideol- ogy of deterministic constraint. If the phenomenon is not new, as the case of war financing by the tax State illustrates, it experienced a deci- sive turnabout with the global diffusion of the neo-liberal concept of the market. Periods of “crises” (oil crises, financial bubbles, raw materials, social welfare etc.) are reinforced here by the intensification and “finan- ciarisation” of global capitalism, and are used to mask the real decisions of the interventionist State. Democratic consultation on possible choices is thus limited, in particular by the lack of clarity in the relation between tax revenue (loans, taxes) and public policies (expenditure). It is not easy to include financial action in the classic typologies of public policies: indeed taxation is used as an instrument in a complex way within fragmented issues which are related to practically all the aspects of life in society and of the economy. By its...

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